Will Obamacare Actually Make Workers Cheaper to Insure?

Before the Patient Protection and Affordable Care Act was enacted into law, approximately 150 million Americans received health insurance through their jobs. Beginning next year, all business with 50 or more employees will pay a penalty for not offering coverage to its workers, and those not covered through their jobs will be required to purchase insurance as well.

Since the healthcare reform championed by President Barack Obama was passed just over three years ago, policymakers, politicians, and industry leaders have searched for insights into how the Affordable Care Act would affect businesses and workers. Because Massachusetts enacted a law in 2006 that provides healthcare coverage to over 98 percent of its residents, and that eventually served as a model for the architect of Obamacare, the state’s healthcare reform can be used to assess the impact of the Affordable Care Act.

PricewaterhouseCoopers, an accounting firm that analyzed the healthcare reform in Massachusetts, found that employer-sponsored insurance rose in the years after the legislation was passed, even as coverage continued to decline nationally. The reform required businesses with 11 or more employees to make a “fair and reasonable” contribution towards insurance coverage, and individuals must carry insurance or pay a penalty if not covered by their employers. The state offered a 15 percent rebate to help businesses that adopt wellness programs.